Forecast of future earnings

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Reference no: EM133020805

You have come up with a forecast of your future earnings. Based on completing your degree you will earn:

  • $20,000 next year (one-year from now);
  • $30,000 two years from now;
  • $40,000 three years from now; and,
  • $150,000 four years from now and every year there-after for another 34 years (35 such payments in total)

Assume your earnings in all of these years are received as one lump-sum payment at the end of every year. Assume your personal discount rate is 6%.

What is the present value of your estimated future income (you can round all calculations and your final answer to whole dollars)?

Reference no: EM133020805

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